Dismissal for Serious Misconduct

Termination of Contract
If an employee has deliberately and wilfully performed any of the following actions, then the employer has the right to immediately dismiss the employee for serious misconduct.
  • Fraud / Dishonesty
  • Intoxication or drug use
  • Assault
  • Refusal to carry out lawful instruction that is part of the job
  • Risk to health and safety of others
  • Other matters relevant to the nature of employment and workplace policies, such as offensive language, offensive material, out-of-hours conduct, professional negligence or loss of professional qualifications

Steps the Employer Must Take

  1. Organise a meeting with the employee and advise they can have a support person at the meeting. The employer should also have a witness to attend the meeting.
  2. At the meeting, present all facts and evidence to the employee; preferably have proof in writing or audio.
  3. Allow the employee to respond during the meeting or provide a written explanation after the meeting. It is recommended that the witness takes notes of what is said during the meeting.
  4. After the meeting, suspend all duties of the employee until all facts and evidence have been reviewed and a decision about future employment has been made.
  5. After the meeting, the employer needs to write an email or letter to inform the employee that all evidence will be reviewed and a decision about their future employment will be decided within 1-3 days.
  6. After all evidence has been considered and it is clear the employee has in fact engaged in serious misconduct, the employer must provide an opportunity for the employee to “show cause” as to any reason they should not be dismissed. Following consideration of any such information, the employer has the right to terminate without giving the employee any period of notice. The dismissal must be done in writing outlining the reasons for termination.
  7. The employer must pay the employee for time worked up until they are escorted from the workplace after the meeting; they may also be required to pay the employee while they are suspended until the employer reaches a decision and a formal termination date is decided. Check with Fair Work.

Frozen In Lieu of Notice Payment

This type of dismissal has implications for the payout of leave and notice of termination. The FairWork Act 2009 (s117) has a provision that no in lieu of notice is to be paid if the employee is dismissed for serious misconduct. However, always check the award and / or employment contract.

Frozen Long Service Leave

For entitlements, annual leave not taken is to be paid regardless of the reason for ending the employment, as stated in the National Employment Standards; however, long service leave is a different matter and dependent on each state’s long service leave act. All states except Victoria withhold any pro-rata long service leave entitlement if the employee has been dismissed for serious misconduct prior to reaching the period of service when they are able to take the leave. However, if the employee has worked long enough to take the leave according to the state regulations, they will still be paid for their entitlement. Regardless of the reason for termination, Victorian employees are entitled to LSL being paid out. An employee still has the right to approach Fair Work for an unfair dismissal claim, therefore following the guidelines above will minimise the chance of the employee being successful in a claim. References

ICB LogoThis article has been produced based on research conducted by ICB – Institute Certified Bookkeepers – Membership No. 350710

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